Michael McGrath (Cork South Central, Fianna Fail)
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206. To ask the Minister for Finance if a beneficiary is entitled to avail of the principal dwelling house exemption in respect of the property they legitimately lived in all their life with regard to the application of inheritance tax law and in the event where a person inherits two residential properties at the same time following the death of a parent having previously not owned any residential property; and if he will make a statement on the matter. [27212/16]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by Revenue that, under section 86 of the Capital Acquisitions Tax Consolidation Act 2003, gifts and inheritances of dwelling-houses can qualify for an exemption from the payment of Capital Acquisitions Tax (CAT) once certain conditions are satisfied. This relief is referred to as the "dwelling house exemption".

One of the qualifying conditions for the dwelling house exemption is that the individual receiving the gift or inheritance (the "beneficiary") must have occupied the dwelling house as his or her only or main residence for the period of 3 years immediately preceding the date of the gift or inheritance. Another condition is that the beneficiary must not have any beneficial interest in another residential property at the date of the gift or inheritance. A beneficiary is treated as having a beneficial interest in another residential property where he or she inherits more than one such property at the same time, whether or not the individual previously owned any such property.  Therefore, where two residential properties are inherited at the same time, the beneficiary does not qualify for the dwelling house exemption.